21 April 2011
Jesse's Café Américain:
What I Think the Fluctuations & Trends In the Comex Silver Inventory Mean
I am not talking about the specifics, about which individual holder of bullion changed the status of a very large portion of the remaining registered silver inventory at the Comex, and what their particular motivation might have been. I imagine that the details of that transaction and its short term intent will become known at some point. I am not even sure yet whether it is bullish or bearish. It could be part of a short term trading gambit tied in with the coming option expiration.
I wanted to step back and get the significance of this in the 'big picture.' So I looked at the interactive Comex silver inventory chart over at 24hourgold to see what the big withdrawal from the registered ounces looked like in context. The chart goes back to middle 2008.
Several things stand out for me. First, there are definitely big declines in the past, certainly on the order of the most recent decline this week.
There is one significant difference. Two of the biggest declines occurred at year end, and are indicated on this chart as circles.
There are another two large declines in inventory comparable to this week in April time frames, marked on the chart by rectangles.
So its just a normal thing, right?
Not really. The prior two declines in April occurred after significant builds in inventory from the first of the year. This year that simply did not happen. There was no bounce...